The business succession regime (BOR) has been a hotly debated topic in recent years. The BOR is a tax scheme that allows (family) businesses to be transferred to the next generation (via gift or inheritance) without or with limited taxation. As of January 1, 2025, several rules regarding the business succession regulation have changed and as of January 1, 2026, even more will change. We are happy to outline the changes for you.
As of January 1, 2025, several changes to the business succession scheme in the gift and inheritance tax (BOR) and the pass-through scheme in the income tax (DSR) have been implemented. We would like to outline these for you below.
Adjustment of scope of exemption
The BOR has an exemption for business assets of 100% of the goingconcern value. As of January 1, 2025 the 100% exemption has been increased to € 1,500,000 (2024: . € 1,325,253) Over the remainder the exemption as of January 1, 2025 will still be 75%. This concerns a reduction; in 2024, for example, an exemption of 83% still applied.
Abolition of efficiency margin
The business succession schemes distinguish between business assets and investment assets. Only business assets qualify for the application of the schemes. Until 2025 the BOR included a so-called efficiency margin, which stipulated that 5% of the investment assets could be included in the business assets. As of January 1, 2025, this efficiency margin has been abolished.
Limited mixed-use application
Until 2025, business assets that are used both for business and private purposes may be optionally regarded as business assets. As of January 1, 2025, only business assets will qualify for the BOR and DSR if they represent a minimum value of €100,000 and if they are used for more than 90% in the business at the time of donation.
Abolition of employment requirement and introduction of minimum age
Until 2025, the gift transferee had to be employed by the company for at least 36 months before claiming the income tax pass-through provision. As of January 1, 2025, this rule was dropped. There is no longer a requirement that the donee be employed by the company for a minimum period. However, as of January 1, 2025, in case of a gift, the recipient must be at least 21 years old to benefit from the BOR and DSR.
Adjustment of the continuation requirement
Until Jan. 1, 2025, the requirement was that the acquirer had to continue the business for five years (to maintain the BOR). As of January 1, 2025, this requirement has been shortened to three years.
Changes from 2026
The following measures will take effect from January 1, 2026:
- Limitation of access BOR to regular shares with interest of at least 5% (BOR and DSR).
- Relaxation of the possession requirement: the possession requirement remains five years, but changes in the legal structure do not lead to the commencement of a new possession period.
- Approach to improper use BOR: for a testator or donor who has reached the state pension age, the possession period will gradually be extended. Also, application of the BOR is excluded if the company has been owned by the transferee at any earlier time.
In conclusion
We are happy to think with you about the possibilities of a business succession. Feel free to contact us for the possibilities through your relationship manager, via our contact form on the website or on our general phone number 040 - 2 504 504.